The Telecommunications services industry is globally less investing in Research and Development expenditures (R&D), in term of revenues in 2005 compared to 2000 (sample of top 250 ICT firms) . There is a strong trend in telecommunications services globally. These companies rely more and more on manufacturing and subcontracting to create new products, applications and services. Innovation is more created externally of the firm, and inside a network of partners (suppliers, competitors) and institutions (universities, technology organisms). IT equipment is facing some similarities in term of external innovation creation. However, the IT equipment industry is no more in the frenzy growth of 2000 and is facing more normal profitability (see graph in the previous comment). Software is investing almost the same percentage in R&D in 2005 vs 2000. In this industry the control in the creation of new products is very strategic and there are less opportunities for subcontracting. Thus, as we can see the patterns of innovation may be different between industries and even between ICT industries. A very useful tool to understand the dynamic of these patterns is the "game of innovation". We will cover those games in a future comment.
Louis Rhéaume
Infocom Intelligence
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